Bank of India NPS

Home / Glossary / Saving Schemes / Bank of India NPS

Introduction

The National Pension Scheme (NPS) is a government-backed pension initiative regulated by the Pension Fund Regulatory and Development Authority (PFRDA). The Bank of India (BOI) NPS is one of the preferred platforms for salaried and self-employed individuals looking for retirement planning with tax benefits. This scheme allows investors to contribute towards their retirement corpus while enjoying various tax incentives.

What is the NPS Scheme?

The National Pension Scheme (NPS) is a voluntary long-term investment plan designed to provide financial security post-retirement. It allows subscribers to systematically invest in a mix of equity, corporate bonds, and government securities based on their risk appetite. The NPS is available to both salaried employees and self-employed individuals, providing them with a structured retirement savings plan.

The NPS scheme in Bank of India allows individuals to subscribe through the bank’s extensive network and digital platforms, making the process seamless and accessible.

You may also want to know the South Indian Bank National Pension System

Features of Bank of India NPS

The Bank of India NPS offers numerous benefits to individuals looking for a secure post-retirement financial plan. The key features include:

Dual-tier structure: The NPS has two types of accounts:
- Tier I Account: A mandatory retirement savings account with restrictions on withdrawals.
- Tier II Account: A voluntary savings account with greater flexibility for withdrawals.
Choice of investment options: Investors can select auto or active investment modes based on their risk appetite.
Multiple fund manager options: Subscribers can choose from various fund managers authorized by PFRDA.
Portability: The NPS scheme in Bank of India is flexible and allows seamless transfer of accounts across locations and employment status.
Low-cost investment: Compared to other retirement investment plans, NPS has low management costs.

Eligibility Criteria to Open BOI NPS Account

Individuals can subscribe to Bank of India NPS if they meet the following criteria:

Must be an Indian citizen.
Must be between 18 and 70 years of age.
Should comply with Know Your Customer (KYC) norms.
Must contribute a minimum of Rs. 500 for a Tier I account and Rs. 1000 for a Tier II account at the time of account opening.

Tax Benefits under BOI NPS

The National Pension Scheme (NPS) provides various tax incentives under the Income Tax Act:

Under Section 80CCD(1): Employees can claim tax deductions up to 10% of their salary (basic + DA) or Rs. 1.5 lakh under Section 80C.
Under Section 80CCD(2): Employer contributions (up to 10% of salary) to an employee’s NPS account are tax-free.
Under Section 80CCD(1B): An additional deduction of Rs. 50,000 is available for self-contributions beyond Rs. 1.5 lakh under Section 80C.

How to Invest in Bank of India NPS?

Investors can subscribe to Bank of India NPS through the following methods:

Online Process:

Visit the official Bank of India website.
Navigate to the NPS account opening section.
Register using PAN/Aadhaar and complete the KYC process.
Choose your investment preference and fund manager.
Make an initial contribution online.
Receive the Permanent Retirement Account Number (PRAN) for future transactions.

Offline Process:

Visit the nearest Bank of India branch.
Request an NPS registration form.
Fill in the required details and attach necessary documents.
Submit the form along with an initial contribution.
Receive the PRAN number upon successful registration.

Documents Required for Opening the Bank of India NPS Account

To open an NPS account in Bank of India, individuals must provide:

Identity Proof: Aadhaar card, PAN card, Passport, or Voter ID.
Address Proof: Aadhaar, Passport, Utility bills, or Rental agreement.
Photograph: Recent passport-sized photo.
Bank Account Details: Canceled cheque or bank passbook copy.

NPS Investments and Subscriptions

The BOI NPS allows subscribers to make periodic contributions towards their retirement corpus. Key aspects include:

Minimum annual contribution: Rs. 1000 in a Tier I account.
Investment flexibility: Subscribers can choose different asset classes – Equity (E), Corporate Bonds (C), and Government Securities (G).
Auto and active choice: Individuals can opt for an automatic allocation of funds based on their age or actively manage their portfolio.

Point of Presence (POP) in Bank of India

Bank of India acts as a Point of Presence (POP) for NPS, facilitating account registration, contribution processing, and investor support. Investors can approach BOI branches for:

Opening a new NPS account.
Managing their investment portfolio.
Making withdrawals post-retirement.

Conclusion

The Bank of India National Pension Scheme (NPS) is a structured and tax-efficient retirement savings option designed for individuals seeking financial security post-retirement. The scheme offers multiple benefits, including tax deductions, flexible investment choices, and government-backed security. With Bank of India acting as a reliable Point of Presence (POP), subscribers can easily manage their NPS investments online or offline. Whether you are a salaried employee or self-employed, investing in the Bank of India NPS can ensure a financially stable retirement.

Frequently Asked Questions

Who can open an NPS account with the Bank of India?

Any Indian citizen between 18-70 years can open an NPS account in the Bank of India.

How can I open an NPS account in the Bank of India online?

You can open an NPS account online through the Bank of India portal using PAN/Aadhaar and completing KYC verification.

What is the minimum contribution for BOI NPS?

The minimum contribution for a Tier I account is Rs. 500 and Rs. 1000 for a Tier II account.

Can I claim tax benefits on my NPS investments?

Yes, tax benefits up to Rs. 2 lakh can be claimed under Section 80C and 80CCD.

What is PRAN in NPS?

The Permanent Retirement Account Number (PRAN) is a unique 12-digit number assigned to every NPS subscriber.

Can I exit from the NPS scheme before retirement?

Yes, premature exit is allowed under specific conditions, with 20% withdrawal permitted and 80% invested in an annuity plan.

Can I change my fund manager in BOI NPS?

Yes, subscribers can change their fund manager once a year.

How do I check my NPS account balance in BOI?

You can check your NPS account balance online via the NSDL website or through the Bank of India portal.

Open Free Demat Account

Related Terms

Explore our feature-rich web trading platform

Get the link to download the App